Shrink Reduction and Margin Recovery

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As a successful retail executive, you’ve done the hard part. You have built the brand, attracted the customers, sourced and merchandised the products, executed at the store level and converted the sale. However, despite your best efforts, not every dollar of hard-earned sales, margin and income will make it through to your bottom line.

Merchant Analytic Solutions ("MAS"), a company jointly owned by SD Retail and Hilco Merchant Resources, has created a service-based solution for retailers that can add 100 to 300 basis points of sustainable top line and bottom line improvement on your existing sales. As comps and income soften in today’s business environment, the results of our Sales and Margin Recovery program can not only compensate for this pullback but magnify any upticks in your business. What’s more, we perform these services on a pay-for-performance model and transfer the knowledge to you to insure sustainability of results.

What is Shrink Reduction and Margin Recovery?

MAS partners with your team to stem “leakage” of significant dollars through identification and reduction of Sales Reducing Activities (SRA). Statistics show that, across retail, SRA decrement retailers’ sales on average by 3-4% annually. Retail SRA include 7 core base measures, these transaction sets have three basic sources: legitimate transaction events, process breakdown events which can erode margin and cause shrink, and fraudulent activities which erode both margin and shrink as well as impact incremental sales capture:

• Refunds
• Voids
• Transaction Cancels
• Price Modifies
• Discounts
• Coupons
• Tax Removal

The broad view of SRA take by MAS enables retailers to curtail losses well beyond the traditional areas of inventory shrink. SRA stem from two main sources: process errors and deviant activity.  Proprietary methodology expands the reach of traditional LP measures and POS transaction monitoring to deliver a comprehensive, proactive and powerful solution that significantly reduces the impact of all forms of SRA.

How does MAS do it?

Utilizing Shrink Reduction and Margin Recovery approachs, MAS utilizes your existing transactional and operational data, applying our experience in retail management and LP and our proprietary analytical processes, to identify and deliver a series of transaction event foot prints with corresponding risk values for each transaction sequence. This risk-based prioritized list of transactions serves as the basis for research and investigations. The increased precision and productivity of investigations delivers a material increase in sales, margin and income.

How you can get started.

To assess the potential impact to you and your business, MAS offers a no-cost Risk Profile/Opportunity Assessment which is provided based on few key data points and limited transactional detail. These opportunities will be reviewed with you and design solutions will be deveoped based on your existing processes, technology, culture, and business model.

Impact to you, your customers and your shareholders is significant, immediate, and sustainable financial performance through:

• Improved gross margin
• Improved sales capture capabilities
• Improved shrink risk rate
• Improved net profitability
• Improved operational performance